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The misconception about dollar stores is that they sell cheaper products. However it’d be cheaper to buy almost anything per unit at Costco. Dollar stores provi

The misconception about dollar stores is that they sell cheaper products. However it’d be cheaper to buy almost anything per unit at Costco. Dollar stores provide a service when they sell the same products but smaller sizes, which makes it easier for people who don’t have enough cash to buy stuff.

onlyrealcuzzo 3y ago
1. Don't have enough cash to buy stuff 2. Don't have enough capacity to eat stuff quickly (single people, small families) 3. Don't have ability to preserve stuff (don't have a full kitchen, maybe not even a refrigerator, maybe live in their car, etc) 4. Don't have the ability to get anywhere else 5. Not everyone "poor" is stupid - some people just want to buy Velveeta Cheese and pay a lot for it, for whatever reason, instead of whatever Aldi is selling. etc... I'm growing tired of this idea that everyone "poor" is dumb. The median "poor" person isn't much less intelligent than the median middle class person (and probably upper class for that matter, too).
- darth_avocado 3y ago
  Literally no one said poor people are dumb, just pointing out how dollar stores work because they provide a service.
  - onlyrealcuzzo 3y ago
    Literally the top comment: > The thing I don't like about these stores is IMO they take advantage of poor people who think they are getting cheaper products, but in many cases, especially for food items, they're paying more. A gallon of milk was $3.50 last time I went to one, whereas it was $1.89 at Meijer. Of course, Meijer does the same thing: if you buy milk at their gas station store, it's also well over $3, but inside the store it's under $2. It's stating that poor people are being taken advantage of - not that they have different circumstances and these stores actually serve them - otherwise, they wouldn't exist. It's implying that all of us on HN are too smart to be taken advantage of and shop at better stores. > They have one kind and the price is usually reasonable, whereas the large grocery stores play all kinds of games intended to cause people in a hurry or with limited time or ability to compare products, to choose the wrong thing and pay more. Just because you shop at Dollar Family doesn't mean you're dumb and being taken advantage of. Or that you're not smart enough to compare products. It means you (likely) have different preferences (for maybe unfortunate reasons). Dollar Tree and Aldi are both trying to make as much money as possible off of their customers.
morkalork 3y ago
And also proximity. Costco usually requires a car to get to vs dollar stores that are clustered around public transit.
faeriechangling 3y ago
Costco has a higher income cachet, there’s a reason Charlie Munger adored it so. When you’re living in a 100sqft SRO and walking for your groceries the value of the dollar store is more obvious. Because it’s a STORE for the things you can’t fit at home that is near your home, which sells items in small quantities. The entire dollar store model is many locations and small footprint. It doesn’t make a lick of sense for them to take their car (???) and drive over to Costco to buy a 12 pack of paper towels that will be lying around for a year or two because it’s technically cheaper per unit. For all this talk of the poor being exploited I think people grossly underestimate in general how wise the poor is with their money. They don’t have much of it so they have to think hard about how to spend each dollar.
- bombcar 3y ago
  All that is true, but the dollar stores (perhaps more correctly called convenience stores?) have issues, too. Ours is literally across the street from a Walmart, and many items are priced higher than Walmart for the exact same size. However, one of the best things you can do to save money is identify waste, which sometimes means buying a smaller more expensive (per unit) item than a larger and cheaper per unit one. There's no reason to buy a gallon of milk if you always throw away half.
  - faeriechangling 3y ago
    When I’ve been poor and seen this happen, I tended to shop at both stores because some items at the dollar store are actually cheaper. Just like many grocery stores have rotisserie chickens sold under cost, the dollar store has its own anchor items like the balloons. The fact that some items are overpriced is part of the game they’re playing. It’s asking the customer “are you really going to wait in another lineup to save a buck?” It’s also taking advantage of the fact it’s cognitively difficult to memorize the price of each product in both stores, especially because the prices change and the size of products is often different, so it’s easy to get confused and overpay. Yet they aren’t really taking advantage of customers any more than Walmart is when they throw a sale and puts their best value items at the back corner of the store forcing their customers to walk past worse value items. It’s also simply the case that Walmart simply has less overhead and can pass the savings on. Not to mention more negotiating power.
zeroonetwothree 3y ago
Costco is only cheaper if (a) you will always use the full amount of product before it spoils or you no longer need it and (b) the cost of traveling the extra distance and spending more time shopping is lower than what you save on the purchase itself. It's not the case that these are both satisfied for everyone.
bombcar 3y ago
Even if you take Costco out of the picture, Walmart is almost always cheaper for basically everything at a (now more than a) dollar store. There are a few exceptions (nothing I've found beats their helium balloons, if in stock). But dollar stores are everywhere.
dehrmann 3y ago
Being poor is expensive because you can't hit even modest economies of scale.
xtiansimon 3y ago
“…easier for people who don’t have enough cash to buy stuff” Or storage space, or Costco membership, or personal transportation

onlyrealcuzzo 3y ago

1. Don't have enough cash to buy stuff 2. Don't have enough capacity to eat stuff quickly (single people, small families) 3. Don't have ability to preserve stuff (don't have a full kitchen, maybe not even a refrigerator, maybe live in their car, etc) 4. Don't have the ability to get anywhere else 5. Not everyone "poor" is stupid - some people just want to buy Velveeta Cheese and pay a lot for it, for whatever reason, instead of whatever Aldi is selling. etc... I'm growing tired of this idea that everyone "poor" is dumb. The median "poor" person isn't much less intelligent than the median middle class person (and probably upper class for that matter, too).

darth_avocado 3y ago
Literally no one said poor people are dumb, just pointing out how dollar stores work because they provide a service.
- onlyrealcuzzo 3y ago
  Literally the top comment: > The thing I don't like about these stores is IMO they take advantage of poor people who think they are getting cheaper products, but in many cases, especially for food items, they're paying more. A gallon of milk was $3.50 last time I went to one, whereas it was $1.89 at Meijer. Of course, Meijer does the same thing: if you buy milk at their gas station store, it's also well over $3, but inside the store it's under $2. It's stating that poor people are being taken advantage of - not that they have different circumstances and these stores actually serve them - otherwise, they wouldn't exist. It's implying that all of us on HN are too smart to be taken advantage of and shop at better stores. > They have one kind and the price is usually reasonable, whereas the large grocery stores play all kinds of games intended to cause people in a hurry or with limited time or ability to compare products, to choose the wrong thing and pay more. Just because you shop at Dollar Family doesn't mean you're dumb and being taken advantage of. Or that you're not smart enough to compare products. It means you (likely) have different preferences (for maybe unfortunate reasons). Dollar Tree and Aldi are both trying to make as much money as possible off of their customers.

morkalork 3y ago

And also proximity. Costco usually requires a car to get to vs dollar stores that are clustered around public transit.

faeriechangling 3y ago

Costco has a higher income cachet, there’s a reason Charlie Munger adored it so. When you’re living in a 100sqft SRO and walking for your groceries the value of the dollar store is more obvious. Because it’s a STORE for the things you can’t fit at home that is near your home, which sells items in small quantities. The entire dollar store model is many locations and small footprint. It doesn’t make a lick of sense for them to take their car (???) and drive over to Costco to buy a 12 pack of paper towels that will be lying around for a year or two because it’s technically cheaper per unit. For all this talk of the poor being exploited I think people grossly underestimate in general how wise the poor is with their money. They don’t have much of it so they have to think hard about how to spend each dollar.

bombcar 3y ago
All that is true, but the dollar stores (perhaps more correctly called convenience stores?) have issues, too. Ours is literally across the street from a Walmart, and many items are priced higher than Walmart for the exact same size. However, one of the best things you can do to save money is identify waste, which sometimes means buying a smaller more expensive (per unit) item than a larger and cheaper per unit one. There's no reason to buy a gallon of milk if you always throw away half.
- faeriechangling 3y ago
  When I’ve been poor and seen this happen, I tended to shop at both stores because some items at the dollar store are actually cheaper. Just like many grocery stores have rotisserie chickens sold under cost, the dollar store has its own anchor items like the balloons. The fact that some items are overpriced is part of the game they’re playing. It’s asking the customer “are you really going to wait in another lineup to save a buck?” It’s also taking advantage of the fact it’s cognitively difficult to memorize the price of each product in both stores, especially because the prices change and the size of products is often different, so it’s easy to get confused and overpay. Yet they aren’t really taking advantage of customers any more than Walmart is when they throw a sale and puts their best value items at the back corner of the store forcing their customers to walk past worse value items. It’s also simply the case that Walmart simply has less overhead and can pass the savings on. Not to mention more negotiating power.

zeroonetwothree 3y ago

Costco is only cheaper if (a) you will always use the full amount of product before it spoils or you no longer need it and (b) the cost of traveling the extra distance and spending more time shopping is lower than what you save on the purchase itself. It's not the case that these are both satisfied for everyone.

bombcar 3y ago

Even if you take Costco out of the picture, Walmart is almost always cheaper for basically everything at a (now more than a) dollar store. There are a few exceptions (nothing I've found beats their helium balloons, if in stock). But dollar stores are everywhere.

dehrmann 3y ago

Being poor is expensive because you can't hit even modest economies of scale.

xtiansimon 3y ago

“…easier for people who don’t have enough cash to buy stuff” Or storage space, or Costco membership, or personal transportation